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NORANDA BAUXITE ANNOUNCES ISSUANCE OF NEW SPECIAL MINING LEASE, WHILE PAYMENTS TO GOVERNMENT AND OTHERS EXCEED US$26 MILLION TO DATE



0 | 2018-09-10 14:55:00

 Noranda Bauxite, the bauxite mining operation owned by New Day Aluminum LLC (New Day), has been granted a new and expanded Special Mining Lease to mine25 years of bauxite (plus a 25-year renewal) at up to 5.2 million tons per year from reserves located in the Jamaican parishes of St. Ann and Trelawny. The new Lease, signed on September 6th by the Honorable Robert Montague, Minister of Transport and Mining, secures reserves sufficient for Noranda Bauxite to operate its St. Ann mining business for decades to come. The Lease is part of a new and unique paradigm in the Jamaican bauxite industry, contemplating a 50-year relationship in which the Government of Jamaica receives not only a minimum levy for each ton of bauxite mined and shipped, but also a share in the profits of New Day. New Day operates Noranda Bauxite in Jamaica as well as Noranda Alumina, an alumina refinery in Gramercy, Louisiana. In addition to the profit sharing, New Day has agreed to make the Government whole on $12.6 million in back levy amounts that the Government could not recover from the former operator of the business, as well as paying another $6.4 million the former operator owed to ex-employees and contractors. The September 6th mining Lease was issued the same day that New Day paid the Government of Jamaica more than $7 million in profit sharing and back levy payments.
Since acquiring the Noranda Bauxite and Alumina assets in late October of 2016, New Day has paid roughly $21.6 million in profit sharing, royalty payments, and asset usage fees, along with legacy liabilities to third parties of roughly $4.6 million, for a total of more than $26 million. New Day has also invested roughly $14 million more into the Jamaican facility, which engages a workforce of roughly 800 employees and contractors, making it one of the largest industrial operations in St. Ann parish.
David D'Addario, CEO of Noranda Bauxite and New Day, commented, “Our alliance with the Government of Jamaica toward the success of Noranda Bauxite is strengthened by the issuance of this long term mining Lease. With the knowledge that we will have reserves for many years to come, we can confidently continue to invest in our Jamaican facilities, ensuring that our business will operate at maximum efficiency.” Chief Strategy and Operating Officer Thomas Robb added, “We look forward to continuing our fruitful and cooperative relationship with the Government of Jamaica. This new paradigm gives all parties a stake in the success of the business, and the Government has already reaped the rewards of our profitability to date. We also expect to conclude payment of the legacy payments by the Spring of 2022, well ahead of our originally scheduled completion date. ”




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